Exhibit 10.3
 SENIOR SUBORDINATED LOAN AND SECURITY AGREEMENT
 Dated as of August 25, 2010
 by and among
 REGIONAL MANAGEMENT CORP.,
REGIONAL FINANCE CORPORATION OF SOUTH CAROLINA,
REGIONAL FINANCE CORPORATION OF GEORGIA,
REGIONAL FINANCE CORPORATION OF TEXAS,
REGIONAL FINANCE CORPORATION OF NORTH CAROLINA,
REGIONAL FINANCE CORPORATION OF ALABAMA, and
REGIONAL FINANCE CORPORATION OF TENNESSEE
 and
 THE LENDERS PARTY HERETO
 and
 PALLADIUM CAPITAL MANAGEMENT III, L.L.C.,
AS AGENT FOR THE LENDERS




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Table of Contents
 PageSECTION 1. DEFINITIONS
    
    
    11.1. Defined Terms
    
    
    11.2. Accounting Terms
    
    
    131.3. Other Terms Defined in UCC
    
    
    141.4. Other Interpretive Provisions
    
    
    14SECTION 2. COMMITMENT OF THE LENDERS
    
    
    152.1. Subordinated Loan
    
    
    152.2. Interest and Fee Computation; Collection of Funds
    
    
    162.3. Additional Interest
    
    
    162.4. Taxes
    
    
    172.5. Single Obligation; Collateral Security
    
    
    18SECTION 3. CONDITIONS OF BORROWING
    
    
    183.1. Loan Documents
    
    
    183.2. Search Results; Lien Terminations
    
    
    183.3. Organizational and Authorization Documents
    
    
    193.4. Insurance
    
    
    193.5. Additional Documents
    
    
    193.6. Event of Default
    
    
    193.7. Material Adverse Effect
    
    
    193.8. Litigation
    
    
    193.9. Representations and Warranties
    
    
    203.10. Closing Fee
    
    
    203.11. Agents Expenses
    
    
    20SECTION 4. REPRESENTATIONS AND WARRANTIES
    
    
    204.1. Warranties and Representations Re Contracts
    
    
    204.2. Warranties and Representations Re Collateral Generally
    
    
    214.3. Solvent Financial Condition
    
    
    214.4. Organization and Authority
    
    
    214.5. Financial Statements
    
    
    224.6. Full Disclosure
    
    
    224.7. Pending Litigation
    
    
    224.8. Titles to Properties
    
    
    224.9. Licenses
    
    
    224.10. Transaction is Legal and Authorized; Restrictive Agreements
    
    
    234.11. Taxes
    
    
    234.12. Compliance with Law
    
    
    234.13. Borrowers Office and Names
    
    
    234.14. Subsidiaries
    
    
    244.15. No Default
    
    
    244.16. Use of Proceeds
    
    
    24
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Table of Contents
 Page4.17. Bank Accounts
    
    
    244.18. Borrowers Representations and Warranties Re Collateral
    
    
    254.19. ERISA
    
    
    254.20. Labor Relations
    
    
    25SECTION 5. FINANCIAL AND OTHER COVENANTS
    
    
    255.1. Payment of Taxes and Claims
    
    
    265.2. Maintenance of Properties and Existence
    
    
    265.3. Guaranties
    
    
    265.4. Borrowing Base Ratio
    
    
    265.5. Business Conducted
    
    
    275.6. Debt
    
    
    275.7. Further Assurances
    
    
    275.8. Subsidiaries
    
    
    275.9. Interest Coverage Ratio
    
    
    275.10. Accurate Records Re Collateral
    
    
    285.11. Prohibition on Distributions; Equity Capital Changes
    
    
    285.12. Limitation on Bulk Purchases
    
    
    285.13. Transactions with Affiliates
    
    
    285.14. Accounting Changes
    
    
    295.15. Financial Statements
    
    
    295.16. Inspection
    
    
    305.17. Plans
    
    
    31SECTION 6. GRANT OF SECURITY INTEREST
    
    
    316.1. Creation of Security Interest in Collateral
    
    
    316.2. Financing Statements
    
    
    316.3. Location of Collateral
    
    
    326.4. Protection of Collateral; Reimbursement
    
    
    326.5. Release of Collateral
    
    
    32SECTION 7. EVENTS OF DEFAULT
    
    
    337.1. Interest or Principal
    
    
    337.2. Warranties or Representations
    
    
    337.3. Financial Covenants
    
    
    337.4. Other Covenants
    
    
    337.5. Insolvency
    
    
    347.6. Attachment, Judgment, Tax Liens
    
    
    347.7. Default in Other Agreements
    
    
    347.8. Loss of License
    
    
    347.9. Liens
    
    
    347.10. Assignment of Agreement
    
    
    347.11. Change in Control
    
    
    34
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Table of Contents
 Page7.12. Subsidiary Guaranty Termination
    
    
    357.13. Crimes
    
    
    357.14. ERISA Liability
    
    
    35SECTION 8. REMEDIES IN GENERAL; AGENTS MANAGEMENT FEE; ADDITIONAL EQUITY
    
    
    358.1. Remedies
    
    
    358.2. Agents Performance of Obligors Obligations
    
    
    36SECTION 9. CERTAIN REMEDIES AS TO COLLATERAL
    
    
    369.1. Remedies  Collateral
    
    
    36SECTION 10. AMENDMENTS AND WAIVERS
    
    
    40SECTION 11. THE AGENT
    
    
    4111.1. Appointment and Authorization
    
    
    4111.2. Delegation of Duties
    
    
    4111.3. Liability of Agent
    
    
    4111.4. Reliance by Agent
    
    
    4211.5. Notice of Default
    
    
    4211.6. Collateral Matters
    
    
    4311.7. Agency for Perfection
    
    
    4311.8. Concerning the Collateral and the Related Loan Documents
    
    
    43SECTION 12. ASSIGNMENTS; PARTICIPATIONS
    
    
    43SECTION 13. MISCELLANEOUS
    
    
    4513.1. Obligations Absolute
    
    
    4513.2. Entire Agreement
    
    
    4613.3. Amendments; Waivers
    
    
    4613.4. WAIVER OF DEFENSES; WAIVER OF DISCOVERY
    
    
    4613.5. ARBITRATION
    
    
    4613.6. FORUM SELECTION AND CONSENT TO JURISDICTION
    
    
    4713.7. WAIVER OF JURY TRIAL
    
    
    4713.8. Assignability
    
    
    4813.9. [RESERVED.]
    
    
    4813.10. Confirmations
    
    
    4813.11. Confidentiality
    
    
    4813.12. Binding Effect
    
    
    4913.13. Governing Law
    
    
    4913.14. Enforceability; Usury
    
    
    4913.15. Survival of Borrowers Representations; Termination and Release of Liens
    
    
    5013.16. Extensions of Lenders Commitment
    
    
    50
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Table of Contents
 Page13.17. Time of Essence
    
    
    5013.18. Counterparts; Facsimile Signatures
    
    
    5013.19. Notices
    
    
    5113.20. Costs, Fees and Expenses
    
    
    5113.21. Indemnification
    
    
    5213.22. Revival and Reinstatement of Obligations
    
    
    5313.23. Customer Identification  USA Patriot Act Notice
    
    
    53
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Agreement Regional RFCSC RFCG RFCTX RFCNC RFCA RFCTN Borrower Borrowers Agent
 R E C I T A L S
 Existing Subordinated Loan Agreement
   A G R E E M E N T S
 DEFINITIONS.
   Act Section 13.23
 Additional Interest Section 2.3
 Additional Interest Rate Section 2.3




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Adjusted Net Income
 Adjusted Tangible Assets
 Adjusted Tangible Net Worth
 Affiliate
 Agreement
 Bankruptcy Code
 Borrowers
 Borrowing Base
 Bulk Purchase Limit Section 5.12
 Business Day
 Capital Lease
 2




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Capital Securities
 Capitalized Lease Obligations
 Casualty or Condemnation Event
 Change in Control
 Closing Date Section 2.1(a)
 Collateral
      3




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Consolidated consolidated
 Consulting Agreements Section 5.13
 Contingent Liability Contingent Liabilities
 4




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Contract Debtor
 Contracts
 Debt ,
 Default Rate
 5




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Depreciation
 Distribution
 Eligible Assignee
 ERISA
 ERISA Affiliate
 Event of Default SECTION 7
 Existing Subordinated Loan Agreement
 Foreign Plan
 GAAP
 Guarantor
 Hedging Contracts
 6




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Hedging Obligations
 Holdings
 Indemnified Party Indemnified Parties
 Interest Payment Date
 Interest Rate
 IRS Code
 Lenders
 Lien Liens
 Loan Documents Section 3.1
 Management Agreement Section 5.13
 7




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Management Fee Subordination Agreement
 Material Adverse Effect
 Maturity Date
 Multiemployer Plan
 Net Income excluding
 8




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Non-Excluded Taxes Section 2.4(a)
 Obligations
 Obligor
 Other Taxes
 Palladium
 Palladium Capital
 Parallel
 PBGC
 Pension Plan
 Permitted Debt Section 5.6
 Permitted Liens Section 5.1
 9




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Section
5.1 Schedule 4.8.
 Permitted Refinancing
 Person
 Plan
 Property
 Regional
 10




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Regional Holdings Section
 Related Fund
 Related Rights
 Required Lenders
 RFCA
 RFCG
 RFCNC
 RFCSC
 RFCTN
 RFCTX
 RMC Reinsurance
 Security Documents
 Senior Credit Agreement
 Senior Debt
 11




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Senior Lenders
 Senior Loan Documents Schedule 17(a)
 Subordination Agreement
 Subordinated Debt
 Subordinated Loans Section
2.1
 Subordinated Loan Commitment
 Subordinated Loan Mandatory Prepayment Section 2.1(d)
 Subordinated Loan Optional Prepayment Section 2.1(e)
 Subordinated Notes
 Subsidiary Subsidiaries
 12




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Subsidiary Guarantors
 Subsidiary Guaranty
 Subsidiary Security Agreement
 Taxes
 UCC
 Unmatured Event of Default
 Voidable Transfer Section 13.22
 Weighted Average Life to Maturity
 Working Capital
 Accounting Terms
  13




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Other Terms Defined in UCC
  Other Interpretive Provisions
      14




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COMMITMENT OF THE LENDERS.
  Subordinated Loan Commitment SECTION 3 Closing Date
 Subordinated Loan Interest and Payments Section 2.1(b) Section 2.2
 Subordinated Loan Repayments
 Subordinated Loan Mandatory Prepayments Subordinated Loan Mandatory
Prepayment
 15




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Subordinated Loan Optional Prepayments
 Subordinated Loan Optional Prepayment
   Interest and Fee Computation; Collection of Funds
  Additional Interest
 Section 2.1(b) Additional Interest Additional Interest Rate
 16




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Taxes
 Non-Excluded Taxes
     17




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Single Obligation; Collateral Security
  CONDITIONS OF BORROWING.
  Loan Documents
  Loan Agreement
 Subordinated Notes
 Parent Pledge Agreement
 Subsidiary Guaranty
 Subordination Agreement
 Management Fee Subordination Agreement.
 Search Results; Lien Terminations
  18




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Organizational and Authorization Documents
  Insurance
 Section 5.2(a)
 Additional Documents
  Event of Default
  Material Adverse Effect
  Litigation
  19




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Representations and Warranties
  Closing Fee
  Agents Expenses
  REPRESENTATIONS AND WARRANTIES.
  Warranties and Representations Re Contracts
     20




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Warranties and Representations Re Collateral Generally
     Solvent Financial Condition
 Schedule 4.3
 Organization and Authority
  21




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Financial Statements
 Schedule 4.5
 Full Disclosure
 Section 4.5
 Pending Litigation
  Titles to Properties
 Schedule
4.8
 Licenses
 Schedule 4.9
 22




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Transaction is Legal and Authorized; Restrictive Agreements
  Taxes
  Compliance with Law
 Schedule 4.12 Schedule 4.12
 Borrowers Office and Names
  23




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Subsidiaries
 Schedule 4.14
 No Default
  Use of Proceeds
  Bank Accounts
 Schedule 4.17 Schedule
4.17
 24




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Borrowers Representations and Warranties Re Collateral
     ERISA
  Labor Relations
  FINANCIAL AND OTHER COVENANTS.
  25




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Payment of Taxes and Claims
  Maintenance of Properties and Existence
      Guaranties
 Section 5.6 Schedule 5.3
 Borrowing Base Ratio
  26




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Business Conducted
  Debt
 Schedule 5.6 Section 5.3 Permitted Debt
 Further Assurances
  Subsidiaries
  Interest Coverage Ratio
  Fiscal Quarter Ending September 30, 2010 and for each
fiscal quarter thereafter calculated
based on the then fiscal year to date
    
    
    Ratio 1.15 to 1
 27




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Accurate Records Re Collateral
  Prohibition on Distributions; Equity Capital Changes
  Limitation on Bulk Purchases
 Bulk Purchase Limit
 Transactions with Affiliates
 Section 5.11
 28




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Accounting Changes
  Financial Statements.
  Monthly and Annual Statements
     29




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Audit Reports
  Notice of Default or Event of Default
  Requested Information
  Inspection.
  30




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Section 5.16
 Plans
  GRANT OF SECURITY INTEREST
   Financing Statements.
  31




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Location of Collateral.
  Protection of Collateral; Reimbursement.
   Release of Collateral.
  32




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EVENTS OF DEFAULT.
 Event of Default
 Interest or Principal
  Warranties or Representations
  Financial Covenants
 Section 5.9
 Other Covenants
  33




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Insolvency
  Attachment, Judgment, Tax Liens
  Default in Other Agreements.
  Loss of License
  Liens
  Assignment of Agreement
  Change in Control
  34




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Subsidiary Guaranty Termination
  Crimes
  ERISA Liability
  REMEDIES IN GENERAL; AGENTS MANAGEMENT FEE; ADDITIONAL EQUITY.
 Remedies
  Acceleration
 Set-Off
 Attorneys Fees and Expenses
 35




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Default Rate
 Other Remedies
 Agents Performance of Obligors Obligations
 Section 8.2
 CERTAIN REMEDIES AS TO COLLATERAL.
 Remedies  Collateral
    36




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39




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AMENDMENTS AND WAIVERS.
 provided however
     40




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Section 10
 Section
11.6
  THE AGENT.
 Appointment and Authorization Section 11 Sections 8 and 9
 Delegation of Duties
 Liability of Agent
 41




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Reliance by Agent
 Notice of Default provided however provided however
 42




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Collateral Matters
   Agency for Perfection
 Concerning the Collateral and the Related Loan Documents
 ASSIGNMENTS; PARTICIPATIONS.
  43




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Exhibit A Assignment and Acceptance
   44




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Participant provided however Section 10
 MISCELLANEOUS.
 Obligations Absolute
      45




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Entire Agreement
  Amendments; Waivers
  WAIVER OF DEFENSES; WAIVER OF DISCOVERY
  ARBITRATION
  46




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FORUM SELECTION AND CONSENT TO JURISDICTION
 SECTION 13.5
 WAIVER OF JURY TRIAL
  47




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SECTION 13.5
 Assignability
   Confirmations
  Confidentiality
 Section 13.11
 48




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Binding Effect
  Governing Law
  Enforceability; Usury
   49




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Survival of Borrowers Representations; Termination and Release of Liens
   Extensions of Lenders Commitment
  Time of Essence
  Counterparts; Facsimile Signatures
  50




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Notices
  To a Borrower:
    
    c/o Regional Management Corp.509 West Butler RoadGreesville, SC 29607Attention: Robert D. BarryTelephone No.: 864-422-8011Telecopier No.: 864-422-8035Email: bbarry@rmcorp.bizTo a Lender:
    
    c/o Palladium Capital Management III, L.L.C.1270 Avenue of the Americas, 22nd FloorNew York, NY 10020Attention: Erik ScottTelephone No.: 212-218-5169Telecopier No.: 212-218-5155Email: escott@palladiumequity.com
 rd st
 Costs, Fees and Expenses
  51




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Indemnification
  52




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Revival and Reinstatement of Obligations
 Voidable Transfer
 Customer Identification  USA Patriot Act Notice
 Act
 [The remainder of this page has been left blank intentionally.]
 53




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IN WITNESS WHEREOF
 REGIONAL MANAGEMENT CORP.
REGIONAL FINANCE CORPORATION OF SOUTH CAROLINA
REGIONAL FINANCE CORPORATION OF GEORGIA
REGIONAL FINANCE CORPORATION OF TEXAS
REGIONAL FINANCE CORPORATION OF NORTH CAROLINA
REGIONAL FINANCE CORPORATION OF ALABAMA
REGIONAL FINANCE CORPORATION OF
TENNESSEEBy:
    /s/ Robert D. BarryName:
    Robert D. BarryTitle:
    Chief Financial Officer of each of the
above-listed corporations




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PALLADIUM CAPITAL MANAGEMENT III, L.L.C.,
as AgentBy:
    /s/ David PerezName:
    David PerezTitle:
    Managing DirectorPALLADIUM EQUITY PARTNERS III, L.P.,
as a LenderBy:
    Palladium Equity Partners III, L.L.C.,Its: General PartnerBy:
    /s/ David PerezName:
    David PerezTitle:
    Managing DirectorRICHARD A. GODLEY,
as a Lender/s/ Richard A. GodleyJERRY SHIRLEY,
as a Lender/s/ Jerry ShirleyBRENDA KINLAW,
as a Lender/s/ Brenda Kinlaw




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Schedule I
 Commitments
 Lender
    
    Commitment AmountPalladium Equity Partners III, L.P.
    
    $
    20,813,674Richard A. Godley
    
    $
    2,000,000Jerry Shirley
    
    $
    2,000,000Brenda Kinlaw
    
    $
    1,000,000Total
    
    $
    25,813,674